When the Premier announced a new Energy Minister in March, we were optimistic Amber-Jade Sanderson would bring a fresh and practical approach and a practical and responsible view to the energy debate.
For far too long the State Government has been talking big about the upcoming energy transition but delivering mighty small.
In an opinion piece in The West this month, Ms Sanderson said her “job is supporting our heavy industry to decarbonise to meet national emissions targets”.That is only one part of her job and not her first and most important responsibility.
Her first job is to keep the lights on and power running to all the houses, businesses and heavy industries that need it, and to do it at a cost that householders, businesses, and industries can afford.
The Government’s lack of a clear and coherent energy plan means they are on their way to failing their first responsibility.
Fortunately for all West Australians, the Energy Minister admitted that gas was needed as a transition fuel.
It was good to see Premier Roger Cook also support gas as an export commodity that can reduce emissions overseas and in turn resist a 2030 State target.
The bad part was the reinforcement of the Government position that they are relying on green hydrogen to save their bacon.
As reported by The West in May, a competitive target price for green hydrogen would be $2 per kilogram, but a trial running in WA, partially funded by taxpayers, is producing the hydrogen at $24.50 a kilo.
With a price 10 times the competitive rate, it is no wonder green hydrogen projects are being abandoned at a rapid rate.
In the State Government’s other trial of green hydrogen in Denham last year, it turned out it took 379,503 kWh of wind energy to be converted into 1,422kg of hydrogen, which was then converted back into a tiny 16,044 kWh of electricity being returned to the grid.
In other words, a paltry 4 per cent of the energy used to make green hydrogen made it into the grid as electricity. They would have been 96 per cent better off just transmitting the power straight from wind turbines into the grid.
Households have been protected from this pain, so far, but you shouldn’t expect that will last.
If the Labor Party is relying on green hydrogen to save the day, I suggest we all start cutting and storing firewood and buying matches.
The State Government’s current energy plan simply won’t work. It is underfunded, and about to run out of time.
There is not enough generation, distribution, or storage in the current Government plan to fulfil its first and primary obligation of providing enough affordable energy for homes and businesses.
The real danger is energy prices are about to rise and rise dramatically.
WA has been somewhat insulated from power price rises compared to the eastern States, but we are about to start catching up.
Businesses are the Government’s first targets, with new contracts in Synergy’s contestable markets seeing price increases of 25 to 45 per cent on total power bills.
This is the first sign that the system is broken and not being fixed.
Households have been protected from this pain, so far, but you shouldn’t expect that will last.
The mismanagement of the power system in this State means taxpayers are subsidising
it to the tune of hundreds of millions of dollars every year.
While being hit with regular ongoing price increases, households have been hidden from the real pain of major price increases. But that cannot last, especially if green hydrogen is the proposed solution to the problem.
The State Government needs to find real, practical energy solutions, otherwise families will start to feel the pain that businesses have been suffering the last few years.
Steve Martin is the shadow energy minister
